Which of the following would NOT appear as a liability on the balance sheet?

• A. Accounts Receivable
• B. Notes Payable
• C. Unearned Revenue
• D. Accrued Expenses

Answer: (A)

Verified step by step guidance

1. Step 1: Understand the concept of liabilities. Liabilities are obligations that a company owes to external parties, typically involving the payment of money, goods, or services in the future. Examples include loans, accounts payable, and unearned revenue.
2. Step 2: Review each option provided in the question and determine whether it represents a liability. For example, 'Notes Payable' is a liability because it represents a written promise to pay a specific amount in the future.
3. Step 3: Analyze 'Unearned Revenue.' This is a liability because it represents money received from customers for goods or services that have not yet been delivered or performed.
4. Step 4: Examine 'Accrued Expenses.' These are liabilities because they represent expenses that have been incurred but not yet paid, such as wages payable or interest payable.
5. Step 5: Evaluate 'Accounts Receivable.' This is not a liability; instead, it is an asset because it represents money owed to the company by customers for goods or services already provided.